Reliance Industries stands to gain from Saudi Aramco deal: Experts
Posted on 18th April 2019 |
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Reliance Industries (RIL) stands to gain on crude oil supply security and substantial debt reduction, if reports suggesting a deal with Saudi Aramco are true. This is not the first time reports on a possible deal have emerged. “These talks have been around for two to three years,” said an expert, who did not wish to be named.
Saudi Aramco has been vocal about partnering RIL. In December 2018, Khalid Al-Falih, that country’s minister of energy, industry and mineral resources, had in a tweet put out in Arabic, said: “I was delighted to meet (Mukesh) Ambani, chairman of Reliance #RelianceIndustries, where we discussed opportunities for joint investments and cooperation in petrochemicals, refining, and communications projects in Saudi and India.”
Analysts see it as a good move for both companies. “For the deal to happen, the refining and petchem assets will need to be moved to a separate subsidiary, which means with the holding company discount, debt and interest costs will also go down. In addition, there is greater fuel security,” said an analyst, with a domestic brokerage, who did not wish to be named. As of December, RIL's debt was Rs 2.74 trillion. In the December quarter, its petrochemicals and refining business together contributed a little over 70 per cent to its Ebitda.
For Saudi Aramco, experts see this move as part of the country’s effort to de-risk its economy from oil’s uncertainties. “Saudi Arabia has been making sincere efforts to pick stakes in business not related to oil, for instance SoftBank and electric vehicles. In addition, with India’s growing demand for automobile fuels, major global oil firms see it as a de-risk exercise by picking a stake,” said a person.
Saudi Aramco also plans to partner in building India’s largest oil refinery on its west coast, with state-run oil refiners. With annual profit of $111 billion reported for 2018, experts say Aramco has enough funds for both — a stake in RIL’s refining and petchem business and the mega refinery.
RIL is also expanding aggressively, in its retailing, telecom and other consumer businesses. “RIL will not invest further in oil and gas in a significant way. Even if it does, it will utilise investors’ funds, not the company’s or of its shareholders. They may use funds from this deal to fund their Jamnagar refinery’s expansion,” said the person quoted earlier. |
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Bharti Airtel defers Q2 results till Nov 14 over ambiguity on AGR verdict
Posted on 29th October 2019 |
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Bharti Airtel said on Tuesday it has postponed its second-quarter earnings report to mid-November, as the wireless operator sought clarity on the court ruling asking telecom firms to cough up overdue payments to the government.
Shares of the company, which was expected to release its quarterly numbers later in the day, dropped 3.3 per cent in early trade. |
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Rupee slips 8 paise vs US dollar in early trade amid drop in oil prices
Posted on 7th October 2019 |
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The rupee on Monday opened eight paise lower at 70.96 against the US dollar amid drop in crude oil prices and rise in Asian equities. The domestic unit on Friday closed almost flat at 70.88 against after the Reserve Bank of India (RBI) in a widely expected move cut key interest rates by 0.25 percentage point. On a weekly basis, the local unit slumped by 32 paise. |
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LIC pips private insurers in first-year premium growth during April-August
Posted on 13th September 2019 |
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In the first five months of the current financial year, first-year premiums of life insurance companies grew by 39.84% (year-on-year) at Rs 1.05 lakh crore as compared to Rs 75,588.35 crore in April-August of 2018-19. Life Insurance Corporation of India (LIC) continued to grow at a faster pace compared to private insurance players, shows the data from the Insurance Regulatory and Development Authority of India (Irdai). |
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Apollo Hospitals rules out further stake sale
Posted on 13th September 2019 |
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Apollo Hospitals Enterprise (AHEL) has ruled out further dilution of promoters’ stake in the company. The company also said its Rs 1,337-crore stake sale of Apollo Munich Health Insurance with mortgage major HDFC will be concluded by October. Following these stake sales, the promoters’ pledged position will come down from a high of 76% to 54% by October and eventually to 20% by November or December, company sources said here. |
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World trusts India on Kashmir, not us: Pakistan minister Ijaz Ahmed Shah
Posted on 13th September 2019 |
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In a major embarrassment for Pakistan and its Prime Minister Imran Khan, the country's Interior Minister Ijaz Ahmed Shah, a retired brigadier, said the international community didn't believe Pakistan's narrative on Kashmir; instead it is India whose version is trusted. |
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